MEET THE TEAM

The Government Debt and Risk Management Program provides customized advisory services to middle-income countries to improve macroeconomic and fiscal management by reducing vulnerability to financial and other shocks.

Our Services– from diagnostic to implementation

The Program partners with the client country for a medium time frame. Advisory services are organized around two focus areas to help governments develop and implement sound debt and risk management strategies.

Institutional Strengthening

Governance including the legal framework, institutional arrangements, reporting and transparency

Policy coordination with monetary and fiscal policies

Strengthening the relationship between debt and cash management to improve the implementation of the debt management strategy and supporting domestic market development

Capacity and management of internal operations: skill mix of staff, processes and procedures, and systems

Technical Capacity Development

Debt management strategy, determining the composition of public debt.

Debt management strategy implementation and access to the capital and derivatives markets through the borrowing programs, including measures to improve the functioning of the primary and secondary markets.

Management of contingent liabilities, e.g. sovereign loan guarantees, guarantees issued to public private partnership schemes, legal claims against the government.
Management of other fiscal risks where market-based mitigation is possible.

Asset and liability management: management of the risks from an asset and liability management perspective, encompassing both sides of the government balance sheet.

Our Approach

Know your counterparty

Dedicated World Bank task team leaders throughout the engagement develop a deep understanding of the country context as well as building trust and long term relationships with countries’ management and technical teams to provide quality advice and continuity.

Tailored reform plan design and implementation with the right experts

The core team consists of public debt management professionals who have held positions in public debt offices in emerging and developed countries. By leveraging World Bank infrastructure as well as leveraging world renowned consultants, the team can offer clients high quality support in advanced areas such as issuance in international capital markets, use of derivatives, market, credit and operational risk management, and contingent liabilities management, among others.

Group learning

The program connects countries facing similar issues, providing a platform for in-depth exchange of ideas and experiences. Peer Group Dialogues provide a cost-effective way to discuss challenges and policy actions on a virtual platform; South-South Collaboration promotes in-depth engagement by multi-country authorities and WBG experts to tackle common reform priorities.

Focused on outcomes

The program is focused on outcomes implemented by the client country. As it takes a medium-term, tailored approach, it not only allows time for diagnostic work and plan recommendations, but also time to support the client through implementation, achieving change within the client country and seeing the reform plans take root. Developing sound practice takes time and commitment and involves various stakeholders. The process is best driven by combining international experience with local insight to ensure best-fit outcomes.

The Swiss-World Bank Partnership

Switzerland is a valued, active partner of the World Bank Group (WBG). Through its contributions to select funds, Switzerland deepens its partnership with the World Bank Group and reinforces its status as a key
partner in the effort to end poverty and boost shared prosperity.

The Government Debt and Risk Management Program (GDRM), a trust fund under the World Bank Treasury, initially funded by the Swiss State Secretariat for Economic Affairs (SECO), was established in 2011 to provide support to Middle Income Countries (MICs) on public debt and risk management. The GDRM administers the funding provided by the Government of Switzerland and delivers the work program as mutually agreed and in accordance with the World Bank’s standard operational and administrative policies.

With the support of the World Bank-SECO GDRM Program country partners are sharing experiences and learning from international best practice to reduce their vulnerability to financial shocks through strengthened debt and risk management capacity and institutions and deeper domestic debt markets.

The GDRM Program focuses on middle-income countries (MICs), which are home to 75% of the world’s poor. MICs face a unique set of fiscal challenges: governments must finance the budget at the lowest possible cost, deepen the domestic market, borrow internationally, and develop capacity to handle more complex financial instruments, often with limited human and technical resources. Most current debt and risk management technical assistance for MICs focuses mainly on upstream diagnostic work and developing reform plans, while assistance for targeted, downstream implementation work is limited. The GDRM Program is designed to fill this gap.

The Colombian government partnered with Government Debt and Risk Management Program to fine tune risk assessment and the management of contingent liabilities, among other projects. The outstanding issue was finding a quantitative risk model to determine the right fees, set aside in a contingency fund, and define the right collateral from public entities that wanted government guarantees so that they could borrow.

Ghana's authorities embarked on an ambitious fiscal reform plan and, as part of it, looked at how to improve risk monitoring and assessment related to contingent liabilities.
Partnering with The World Bank Treasury GDRM Program, they engaged in a South–South learning dialogue on contingent liability management, leading to guidelines for the Ghanaian debt management office.

After the Arab Spring, Tunisia experienced a depreciation of the Tunisian Dinar and a major drop in foreign currency reserves. Concerned with the foreign currency exposure, Tunisian debt management office partnered with the World Bank Treasury - Government Debt and Risk Management Program. The joint team developed an accurate methodology to measure the fair value of these theoretical swaps, leading to better advice for economic decisions.

Serbia: After the Crises -Making the Economy More Resilient to Financial Shocks

March 29, 2017

Photo: Serbian ministry of finance. Credit: Alamy Stock Photos

While still recovering from the 2008 global financial crisis, Serbia suffered historic floods in 2014 – two big shocks to its economy. To create space in the public budget to whether crises, the Serbian Public Debt Administration partnered with the World Bank Government Debt and Risk Management Program to reduce borrowing costs and exposure to financial risks.

After the global financial crisis of 2008, a key priority for the Peruvian government was to reduce fiscal vulnerability to external shocks.
As part of this effort, the World Bank Treasury’s GDRM Program worked with the Peruvian Ministry of Finance and Economy on improving the debt management strategy to provide more clarity and transparency in the domestic issuance of government securities
to investors.

For Indonesia, with its large and far-flung population, a modern and efficient infrastructure is vital to connecting with markets at home and abroad. The Indonesian ministry of finance partnered with the Government Debt and Risk Management Program to assess and manage the risks of government guarantees for infrastructure projects. A new scorecard system is helping Indonesia finance infrastructure investment while managing government exposure to credit guarantees and making the economy more resilient to financial shocks.

In the last 30 years, Vietnam has become one of the world’s great development success stories. The country has risen from the ranks of the poorest on the strength of a nearly 7% average growth rate and targeted government policies. As it moves to a market-based public debt management environment with a broad range of borrowing choices, Vietnam has partnered with the World Bank Treasury through the Government Debt and Risk Management Program to improve its Public Debt Law to support investment in infrastructure and social programs.

When Branko Drcelic was appointed head of the Serbian Public Debt Administration in 2012, he was determined build a best-in-class, market-competitive public debt management operation. While Drcelic knew he could rely on the young talent pool around him, he also knew he needed know-how, in terms of technical expertise and training. Serbia joined the Government Debt and Risk Management Program to receive technical assistance to build institutional capacity for debt management.

South Africa: Designing a Better Financial Shock Absorber to Improve Risk Management of the Debt Portfolio

September 22, 2016

Strengthening shock absorbing mechanisms, like the thick bumpers on these fairground car rides, will help South Africa’s treasury better manage risk when it comes to debt

Photo: Snap2Art / Alamy Stock Photo

South Africa has made significant progress to improve the financial risk management of its public debt portfolio thanks to a tailor-made model designed to analyze the costs and risk factors. This tool, developed through a partnership between the Government of South Africa and the World Bank Treasury's Government Debt and Risk Management Program, allows the country to be better positioned to absorb fiscal shocks going forward.

This one-day event is dedicated to taking stock of the achievements of the countries in the Government Debt and Risk Management (GDRM) Program. Debt and risk managers from participating countries will have the opportunity to share experiences on reform implementation and to learn from reform initiatives in other program countries.

The World Bank Treasury is hosting the eighth Sovereign Debt Management Forum, a two-day event, targeted at primarily from developing and emerging market countries. The main objectives of the Forum are to review recent trends and developments in sovereign debt management and to provide debt managers with the opportunity to share their experiences. The agenda will explore the challenges of the current environment and discuss possible responses from the debt management community. In addition, the Forum will bring into focus a range of technical issues associated with implementing sound practices in public debt management.